Mississippi Governor Proposes Tax Increase for Hospitals to Receive More Medicaid Funding
Mississippi Republican Governor, Tate Reeves, has put forward a proposal aimed at assisting financially struggling hospitals in the state. The move comes as the Democratic candidate challenging Reeves in the upcoming election has criticized his stance against Medicaid expansion in one of the nation’s poorest states. Under the proposal, hospitals would pay higher taxes in order to receive a substantial increase in federal Medicaid funding. Mississippi Medicaid director Drew Snyder stated that these changes are projected to generate $689 million, with the funds being divided among hospitals.
Reeves emphasized that the tax increase would come at almost no cost to Mississippi taxpayers. He also highlighted the collaboration between his office, Snyder, and hospital executives in developing the proposal. However, it remains uncertain how long it will take to receive federal approval for the plan.
Mississippi is one of the ten states that have yet to expand Medicaid for low-wage workers without private health insurance. The option for expansion was made available under the healthcare overhaul signed into law by former President Barack Obama in 2010. Reeves has long opposed Medicaid expansion, arguing against adding more people to what he refers to as a welfare program. He believes that the financial impact of expanding Obamacare, as it is commonly known, is not as significant as some may think.
In contrast, health officials have estimated that Mississippi could receive around $1 billion per year from the federal government if Medicaid were expanded. The federal government would cover 90% of the added costs for program enrollees, while the state would be responsible for the remaining 10%.
Democratic nominee for governor, Brandon Presley, denounced the decision to not expand Medicaid as one of the state’s worst choices. He argues that expansion could not only help keep hospitals open but also provide healthcare coverage to approximately 220,000 people. Presley emphasized that these individuals are individuals working in low-wage jobs such as waitresses, Quick Lube employees, roofers, and manual laborers, who desperately need access to healthcare.
Mississippi currently has 74 rural hospitals, with five having closed since 2005. According to the Center for Healthcare Quality and Payment Reform, 24 hospitals are at immediate risk of closure due to severe financial difficulties, placing Mississippi behind only Texas and Kansas in terms of the number of hospitals facing such risks.
Critics, including Chairman of the Mississippi Democratic Party Rep. Cheikh Taylor, dismissed Governor Reeves’ proposal as insufficient. Taylor referred to it as Too little, too Tate, suggesting that the governor’s actions were motivated by politics rather than genuine concern for the state’s residents.
In April, Reeves signed a bill establishing the Mississippi Hospital Sustainability Grant Program to address some of the financial challenges brought on by the COVID-19 pandemic. Under this program, hospitals can receive grants ranging from $250,000 to $1 million based on their size and provision of emergency services. The bill received overwhelming support in both the Senate and the House.
The Mississippi State Department of Health, led by senior deputy Kris Adcock, has received 75 applications for the grant program. Adcock anticipates that funds will be distributed by the end of December.
As the state awaits federal approval for Governor Reeves’ proposal, the debate surrounding Medicaid expansion and healthcare access continues to be a focal point in the upcoming gubernatorial election. The outcome of the election will have significant implications for Mississippi’s hospitals and the many individuals who would benefit from expanded Medicaid coverage.
